The Chase Freedom card has long been one of my favorites. With the ability to earn 5x Ultimate Rewards points on quarterly rotating categories, it is an excellent no-fee card to have in your wallet. Most of the time I can maximize the quarterly category and earn most or all of the 7,500 points for $1,500 in spend.
Except when I make a simple mistake that could cost me all of said 5x return.
Confusion Using Two Chase Freedom Cards
Back in August I downgraded my Chase Sapphire Reserve to a Chase Freedom card, which gives me two of these in my wallet. I’d rather be earning 5x UR for the next couple quarters rather than paying a $450 annual fee. The move was calculated, as I will be looking to pick up a Chase Sapphire Preferred next year for a new sign-up bonus.
But having two Freedom cards resulted in a blunder that I did not expect. The category for Q4 2019 includes PayPal purchases, which should be very easy to maximize. I bought a trio of gift cards a few days ago and paid through PayPal, expecting these to earn me 5x Ultimate Rewards points.
However, I checked my transactions and noticed that these had only earned 1x. Do not all PayPal purchases count? This had me a bit perplexed.
Until I realized the mistake was entirely my own: I’d forgotten to activate the card for the 5x earning. Whoops. I’d activated one of my Freedom cards, but not the second. Although I lost out on an easy 540 Ultimate Rewards points in this case, I immediately clicked the Activate button so that this wouldn’t happen again.
The Need to Activate the 5x Drives Me Nuts
This “feature” is one I can’t stand. Why doesn’t Chase just automatically apply the 5x earning every quarter? What is the point of activation? All you end up doing is denying people points.
But I’m sure this is exactly Chase’s plan. Cause breakage. Discover does the same thing, requiring you to activate the 5% cash back category every three months. It would be so much easier if they just emailed you and said, “Here are the categories. Use your card for 5% back.” I know it’s just a button click, but if I miss the email and it slips my mind, I’m out of luck.
If I had not caught the mistake and made some larger purchases that would put a serious dent in the quarterly cap, I would have been substantially more frustrated. Luckily, I should still be able to easily maximize.
Conclusion
The takeaway is simple: for any card that requires you to activate its 5% earning category, make sure you do it as soon as the window opens. Just get it done so that you don’t have to worry about missing out on points. Chase does make it easy, as you’re able to activate in one click. What slipped my mind that I now need to do this twice. It’s also going to be fun keeping up with the spending on each card to make sure I’m maximizing both cards and not spending more than the $1,500 quarterly 5x cap.
Have you ever lost out on points for so simple a mistake?
Featured image courtesy of Jim the Photographer via Flickr under CC BY 2.0 license.
In addition to breakage, I’m guessing that the need to activate is probably put in place by Chase so that they can track how many people exactly sign up for these offers and how much bonus spend is made. It probably helps them collect and crunch data to seek and work with more partners for 5x categories that appear to be popular to cardmembers. I’m sure someone who manages the card portfolio would want a quarterly report that shows a correlation between activation levels and spending.
That is some great insight. I would certainly want a report to understand which categories consumers respond to, and when they maximize (or don’t maximize) spending.
Great post. I run into a slightly different problem. I always activate my Freedom 5x on time but hardly max it out. 🙂
I think it’s similar to Amex Offers on a broader scale. The purpose is to incentivize spending at these categories on the Freedom card. In Amex’s case, they’re not looking to give an accidental rebate to anyone who shopped at a featured merchant using their Amex – they want to drive incremental business from people who are interested in an offer and then subsequently change their shopping behavior (or at least which card they use) as a result. The freedom is a broader scale version of that (with a smaller % bonus). So by requiring activation, it shows a promotion and response.
Bummer! I sometimes don’t. Restaurants is hard, as we don’t even come close to $1,500 in a quarter.
PayPal this quarter? In the bag.
Chase will still give you 5x for those purchases since you’ve now activated. They have regarded an activation during the quarter as activating the benefit for the whole quarter including time before you pressed activate. The other issuers of rotating category cards do require pre-activation though.
Interesting. I’ll log in when I have a chance and take a look. That would be sweet!
Not sure the timing of when the retroactive purchases should show the 5x, but it’s clear from their FAQ at https://creditcards.chase.com/freedom-credit-cards/faq (expand activation section, 6th question down) that your purchase will count. I’d wait until after the statement closes at least before raising it as an issue with them though.
Awesome. Thanks!
It used to be that Chase would grant you the 5x points on your qualifying purchases as long as you registered to earn 5x before the end of the registration window. Perhaps this is still the case, and you’re not screwed after all?
For example, you make your paypal purchases in Oct, and then as long as you register for Q4 5x earnings by Dec 15th, you’d get credited 5x retro back to the beginning of the quarter. I haven’t tested this in the last few years though, so maybe this info is outdated.
Granted, you still have to click to register and there’s risk that you miss out if you don’t realize it until after Dec 15th. Sucks to have to remember to do that 4 times a year per card.
That would be awesome, and I hope it is the case.
Issue with registration is that I only received *one* email. Chase makes it easy, but if I miss the email (or they don’t send) it’s off my radar. Ironically, they sent me an activation email for the card a day after I logged in to do so.